Monday, January 15, 2007

Value of the iPhone Trademark

Unless you've been on a desert island, you're probably aware that Apple launched its eagerly anticipated iPhone (tm) this past week at Macworld. Unexpectedly and immediately following the announcement, a trademark infringement lawsuit was filed by Cisco Systems against Apple.

There has been a lot written about the genesis of the lawsuit and the discussions that occurred between the companies in the weeks leading up to the launch. What is crystal clear here is the amazing level of value that the companies are attributing to the iPhone trademark.

On a Cisco blog, Mark Chandler, Cisco's SVP and General Counsel states:

"At MacWorld, Apple discussed the patents pending on their new phone technology. They clearly seem to value intellectual property. If the tables were turned, do you think Apple would allow someone to blatantly infringe on their rights? How would Apple react if someone launched a product called iPod but claimed it was ok to use the name because it used a different video format? Would that be ok? We know the answer – Apple is a very aggressive enforcer of their trademark rights. And that needs to be a two-way street."

Some IP law experts cite that Cisco may have let their trademark of iPhone lapse last year. Whatever the facts of this situation turn out to be when all is known, this dispute highlights the importance for companies to be highly diligent in the maintenance of their trademark portfolio. While it is likely that this particular case will be settled, imagine the angst of Cisco shareholders if it were to be found that the company mistakenly missed a filing deadline that may have threatened their ownership of a trademark arguably valued in nine figures.

I'm looking forward, if the case is not resolved quickly, to see exactly how Cisco will assess the value of the trademark and exactly what their claims as to value may be.



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